How 'Bout That Brooklyn Market!
That’ll teach us to read beyond the headline! Turns out that yesterday’s New York Times article “Market Strong for Apartments in Manhattan,” which revealed that prices on the island to the west had risen between 6 and 12 percent last quarter versus the last quarter of 2006, contained even more bullish data for our fair…
That’ll teach us to read beyond the headline! Turns out that yesterday’s New York Times article “Market Strong for Apartments in Manhattan,” which revealed that prices on the island to the west had risen between 6 and 12 percent last quarter versus the last quarter of 2006, contained even more bullish data for our fair borough. According to Corcoran, average prices were 22% higher in the first quarter of 2007 than they were in the period a year earlier; the mean sale price rose from $514,000 to $628,000. The more inventory that we’ve been getting, the more inventory we’ve been selling, said Corcoran veep Frank Percesepe. By comparison, the year-over-year trend in Manhattan was slightly down. We wonder what Q1 2007 looked like versus Q4 2006.
Market Strong for Apartments in Manhattan [NY Times]
Actually, the prices OVERALL NYC are decreasing. Get the facts straight before tooting brooklyns sour horn. We’re on a downward trend and ‘bag holder’ suckers are still buying in, as usual in a bubble atmosphere of DENIAL.
Bloomberg
Manhattan Apartment Prices Increase at Slower Pace – Bloomberg 4/3/07
http://www.bloomberg.com/apps/news?pid=20601093&sid=aVdueuOE8F4c&refer=home
…Overall, the median price of studio and one-bedroom apartments fell 2.3 percent to $390,000 and $635,000, respectively, while the price of two-bedroom units fell 2.8 percent to $1.3 million and three bedrooms declined 1.2 percent to $3.1 million, Miller-Samuel said.
I bought a 6 family brownstone with a large store on the ground level in prime park slope during the recession in the early 90’s for $165,000. The plan was to use the rental income to pay for my education (i was 22 when i bought the building). when i graduated with my medical degree I got a six figure job and the building was earning six figures as well (and the mortgage was paid off).
With all that income I still could not purchase a one family brownstone in park slope. with prices ranging from 2-3 million I would need half a million in cash for the down payment and then look at a monthly mortgage of over $15,000!!
The brownstones in park slope are out of reach for most. While in school I was sure that I would be able to purchase such a home (they were selling for around $900,000-1.2 mill at the time).
I settled for a one family house in midwood with a nice size back yard and a two car garage that I paid a little less then a million for back at 2005.
The future does not look good for young couples looking for a piece of NYC…and that is sad.
I read some coments on the quality of therefore lack of quality on Vermeil VS Novo. I have seen the novo but I live next to the Vermeil and my backyard is facing tha back of it. The TRUTH is that this place is shady to say the least. They have been builidng this place for the last 5 years and I am not joking!!! When they first rolled in the construction equipment, I though they were starting a museum. Now they have a crew of mostly drunk – or illegal day laborers which are there on an on and off basis in other words u never see the same faces. Since there are only 5 to 7 at a same time its not hard to notice. What I do notice are the empty liqure and beer bottles lying around. They are a safety hazard in addition, just walk around the construction site and look at the scaffoldings and the debris chutes, everything done poorly and on the cheap without any pride craftsmanship. So that is the impression this developer portrays to the public. So now imagine what’s going underneath. Scary!!! Just contact the DOB to inquire about violation & law suits this developer has just on this property. I guess that explains the 5 year and still in construction….
Sylvia at 10:18, it’s never not scary to buy real estate. At any time. Especially in NYC; this place takes balls of steel I swear. Maybe just think ahead and look ahead and look at the places that aren’t overpriced right now. What about Staten Island? Or some of the towns upstate, that are closer commutes to NYC? I saw a listing in Beacon NY recently that was really cool – a storefront building in the old downtown area, with residence space above. People who prefer in-city living might like that kind of option, for a small town. Because then they still get to step outside and walk to shops and cafes and interact with people. It’s a thought.
At that rate of increase, my modest 1,500 square foot rowhouse will be worth $43.75 million by the time I’m 65. Therefore, I guess I’m a fool not to quit my job and start living decadently beyond my means.
That will be the new paradigm, because in a few years no one will be able to live here without paying 500% of their income for the mortgage.
The last time I said something sarcastic like that was 2000, when I projected the 100% one-year gain in the NASDAQ forward.
Thanks for the props, 8:41/9:52 (you are the same person, right?), and the advice, I guess, but I’m not looking for a place to buy right now. I’m not waiting for prices to drop 10% or 50% or any percent, it’s just not the right time to buy in the city. Or New Jersey. Or Detroit. I’m taking a guess here, but if you’re a real estate broker who’s sick of hearing people complain about the price of everything and you also own a few properties and think that you somehow pulled yourself up by your own bootstraps and other people should just suck it up and do the same, you’re wrong. Anyone who bought 7 years ago (or even better, before that) in the city lucked out. You got a free ride from a rocketing real estate boom and now you’re recklessly encouraging other people to throw everything they’ve got at an insurmountable problem: the market is tanking, there’s no way that you can singlehandedly stop it by convincing people it’s not. I’m glad you did so well for yourself. Because of certain factors, amongst them my age, I wasn’t able to buy ten years ago, and buying now would be really irresponsible of me. I’ve made my peace with that. I’m secure in my renterhood.
I do know a little about the London real estate market (I have relatives who own their places there), and it seems to be a mirror image of what’s going on in NYC. Same price inflation, same unsustainable equity loans pumping up consumer spending, same complaints, same bitter renter comments. Globalization is a bitch. I just hope my relatives over there don’t end up facing foreclosure, like my friends in other parts of this country are, because of this insane mass mentality that taking out a huge mortgage on an overvalued property is somehow the responsible, adult thing to do.
the situation in london is interesting – only those who got on the property ladder in time are still buying (and those with help from their parents). The percentage of people under 30 not owning has shot up dramatically, and is still increasing – and some people think this will cause a price crash – but not for quite some time. Any views?
I am very lucky to own my place, because I would be priced out at this point. I was half out of my mind 3 years ago when I started looking (after several years out of NY). I couldn’t believe the prices and managed to find a wreck which I could afford, complete with off the wall inherited tenants. The market moved in the right direction which allowed me to refinance it and get the renovation money. The tenants moved. It turned out OK, but I was afraid of being permanently priced out of urban NYC. But now…. I am honestly stunned and a little spooked by the continued price rise. Good for Brooklyn, good for us. The sub prime situation has the potential for tightening credit and the extraordinary numbers of condos coming on the market can dampen the market as well. One other wierd thing is that the differentials between other parts of the country are tremendous. Unless you are very wealthy, moving to NYC from other parts of the country and buying real estate here is very undesireable. At some point, real estate prices begin to weigh on business decisions to maintain offices in the region.
At this point I am in Brooklyn for the long haul, but wow, prices are nuts.
Yes more people are attracted to urban living then anytime in the post WW2 era, yes NY has low,low crime, amazing culture and great transit, yes NYers make more $ then most, yes people from all over the world come here to live, yes, yes, yes BUT
we have also had some of the highest price appreciation anywhere which indicates that all these factors were included in the recent runup of prices, so there is therefore few reasons that NY wont eventually be hit by the slowdown that is effecting the rest of the country.
Generally the more people say “its different” the more you know its not and the end is coming